All Forum Posts by: Jacob Munson

Hey everyone, been doing a lot of research and educating myself on best practices to running an STR successfully. Primarily interested in long distance markets due to prices in my area (San Diego/California).

At a stage where I am evaluating my savings versus the upfront costs to get into a STR property. Obviously aware of the major costs to consider (down payment, insurance, closing costs, etc) but was looking for help on other costs to include during that evaluation.

Rehab costs will be specific to each property but just wanted to make sure there wasn't anything major I was missing!  Thanks in advance

Jacob

Hi all, had a few questions about my condo in Encinitas which I originally purchased for $430k and maximizing tax benefits when I turn it into a rental in the coming year.

1) How do I figure out my adjusted cost basis for calculating annual depreciation? From my tax bill it looks like roughly 70% is land and 30% goes towards improvements of that value. Generally is the annual depreciation calculated off of the 30% improvement amount?

2) I've been reading/hearing about cost segregations a lot recently. To put it simply when do you need to have a cost seg study done? Is this for additional depreciation savings beyond just the annual 3.6%?

Thanks in advance for all the help!

Jacob

Socal resident moving out to CO in the not so distant future recently visited Denver area again and drove through some of the different suburbs west of the city (Arvada, Lakewood, Sloans Lake, etc). Really loved the areas and been trying to game plan a house hack strategy and to this point have been focused on long term rentals but from what I am seeing price wise any sort of decent cash flow seems difficult to find. Becoming more open to the idea of STR/MTR to bring in more upside potential but don't really know what the market is like for it in the area. I guess my questions are:

1) Have folks had success with STR/MTR in these suburbs and what kinds of setups (guesthouse, private basement, etc) seem to be the most in demand?

2) Which areas to avoid as far as STR/MTR ordinances go

3) Any other comments or feedback that you think might be useful

Hey everyone very early on investor here looking to understand more about different lending options for house hacking/long term rentals and had a couple of questions

1) As someone who is interested in house hacking what are the benefits to a 3.5% FHA loan vs a conventional mortgage. I feel like investors view the FHA as a great tool when you're starting out to get into properties but I feel like the downside is the higher payments kill cash flow and/or the ability to offset housing cost in a house hack situation.

2) As you begin to scale past your first few properties does it become more difficult to get loans because your debt to income ratio becomes worse. At this point is creative financing your only option?

Appreciate any thoughts folks have to offer!

Hi! I plan on moving to Denver in the coming years and plan on turning my current residence (2B1B condo in San Diego) into a rental property. I have someone local to help me manage the property but I was curious about the pros/cons of starting an LLC and putting the condo into it. I plan on acquiring additional rental properties as well that I would keep under the LLC if I chose to go that route.

Is it difficult to move a property into an LLC after the fact? Any pitfalls that I should be aware of or things to watch out for?

Thanks in advance!

Hey @Ben Rhodin what is a self sufficency test? And also I do own my condo here in San Diego and posted previously about my strategy to ideally hang onto it and have enough capital to afford a house hack in the future as well. I wrote about it here https://www.biggerpockets.com/...

Pretty sure I can build up enough of a down payment to afford 700-800k around Denver without needing to touch the equity in the condo and hopefully as rents continue to increase can cash flow a few hundred bucks a month early on.

Me and my girlfriend (probably wife by that point) are planning a move to Denver most likely in early 2025 and are interested in house hacking as a means to save income and build a rental portfolio. I'd like to have some sort of target down payment/price to have in mind while we save $$$. Our combined income would be about 200k if that helps (obviously who knows where interest rates will be by then as well). I guess a handful of questions for those that know the area:

- What are areas that would be attractive for 20 somethings like us to live that could also make sense numbers wise.

- Are there a lot of duplexes typically for sale or are most people house hacking with ADU's, basements, other strategies.

- What would be the ideal loan type? Is an FHA best in this type of situation?

- Coming from Southern CA I'm no stranger to high prices but how does Denver compare?

Thanks in advance!

I purchased my 2Bed/1Bath condo in Encinitas (North San Diego) in early 2021 for 435k (40k down) and with the market going crazy the past couple years it is realistically now worth approx 620k. I am looking to relocate to Denver in the next year or two and have been planning on turning the place into a long term rental. 

I'd like to hold onto the property long term as it's in a high appreciation area near the beach and rents in the area are high however cash flow would be minimal because of the mortage/HOA. I am building a savings to go out and buy future deals but would love to be able use some of that equity as well to help jump start my investing.

Wanted some thoughts on if it's best to hold on and hope to refinance/get cash out when rates go down or if in the long run it makes the most sense to sell and put all that equity to work elsewhere. Thanks in advance!

- Jake